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New bidders for EMI?
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October 6, 2000: 9:24 a.m. ET
Reports: Germany's Bertelsmann, Hong Kong's PCCW may muscle in
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LONDON (CNNfn) - On the heels of EMI Group PLC and Time Warner Inc. pulling out of their merger agreement, German media firm Bertelsmann AG and Hong Kong Internet and telecom company Pacific Century CyberWorks could emerge as bidders for the British music firm, media reports said Friday.
Bertelsmann is considering a merger of its BMG music unit with EMI (EMI), the New York Times and Germany's Frankfurter Allgemeine Zeitung (FAZ) business daily quoted industry sources as saying.
Pacific Century CyberWorks, which recently took over Hong Kong's dominant telecom group Cable & Wireless HKT in a $37.4 billion deal, is also  interested in the music publisher, the New York Times reported in its electronic edition. PCCW had been looking at EMI before the Time Warner agreement was announced.
EMI has caught the eye of new potential partners following its joint announcement Thursday with Time Warner Inc. (TWX: Research, Estimates) that the two companies were withdrawing their proposal to create a $20 billion joint venture, deterred by a likely veto from European Union antitrust regulators.
The deal broke down after officials at the European Commission, the EU's executive branch, expressed concerns that the merger would reduce the number of competitors in the global music industry to four from five. The two companies said they would go back to the drawing board to try to come up with an alternative deal that would be acceptable to competition authorities.
Speculation lifts EMI stock
EMI shares were up 1.1 percent, or 6 pence, at 534 in early afternoon trading in London.
Privately owned Bertelsmann, which has been looking to expand its music business, declined to comment on the FAZ report.
"We don't comment on speculation of this kind," said Bertelsmann spokesman Manfred Harnischfeger.
But the success of an approach from either company is questionable.
PCCW and Bertelsmann both lack funds to complete a merger with EMI on their own, the New York Times quoted people close to the company as saying.
Time Warner, the parent company of CNN and CNNfn.com, is also planning to merge with Internet group America Online Inc. (AOL: Research, Estimates) in a $135 billion deal.
Analysts have said that the decision to pull out of the EMI pact could ease the way for the European Commission to give its approval to the AOL-Time Warner merger. 
--from staff and wire reports
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